EU Offers Greater Beef Access To Mercosur

The EU has offered to open up its beef market to the South American trade bloc Mercosur in exchange for greater market access at ongoing talks in Brussels.

Leaders from the European Commission offered to expand beef access to the bloc to 99,000 tonnes per year, up from the current 70,000 tonnes, sources close to the talks told Reuters on Wednesday.

Mercosur consist of founding members Argentina, Brazil, Paraguay and Uruguay. Venezuela has also been a member of the bloc since 2012, but is an observer in, and not party to, the current negotiations.

Constructive Talks

The EC, which negotiates trades on behalf of the EU said that the talks on Tuesday were “constructive” and added that senior negotiators would meet tomorrow to progress trade talks.

Commission Vice-President Jyrki Katainen told a news conference that he was optimistic that a deal would be struck and that negotiations had entered the “end game”.

“Yesterday things moved forward and now we expect Mercosur to come back and give their view on how we could finalise negotiations,” he said, adding both parties were aware that a deal was politically and economically important.

“It’s always very, very difficult but if the political will is strong, as it is at the moment, I‘m sure that we can get this exercise to the goal.”

EU Farming Woes

With regards to tariff reduction, the deal could be three times greater than the EU’s deals with Canada and Japan combined, making it the bloc’s most lucrative deal to date.

Mercosur hosts a fairly closed-off market, with 260 million consumers, an yearly GDP of €2.2 trillion, including the world’s seventh-largest economy and fifth-largest market outside the EU.

It has tariffs of 35% for cars, 20-35% to key machinery products and 18% to soaps and beauty products. The EU exported €42 billion worth of goods to the bloc in 2016 and €22 billion in services the year before.

However, farming nations, such as Ireland and France, have expressed concerns when the initial offering of 70,000 tonnes was proposed. The two countries are anxious to see their farmers will lose out due to price undercutting from Brazilian and Argentine beef.

The European farming association Copa-Cogeca denounced the offer as unacceptable with 75% of all beef imports, or 246,000 tonnes, already coming from Mercosur countries. It argued that the sector was already faced with uncertainty due to Brexit.

“With 52 percent of Irish beef destined for the UK market, we cannot put further pressure on the EU beef market in a trade pact with the Latin American countries,” said the association’s chairman, Jean-Pierre Fleury.